UG catering company Beijk has drastically raised its prices in the cafeterias, in some cases more than 40 percent. According to the catering company, it’s because they’re losing money.
Before the summer, a cup of vegetarian soup cost 1.25 euros. Now, it’ll set you back 1.80. The price of ‘fancy soup’ (which has meat) has gone from 1.80 to 2.50.
It’s the second price increase in a year. Before October 2022, vegetarian soup cost 1.10, with the fancy soup coming in at 1.60. Now, eleven months later, the soups’ prices have increased by, respectively, 64 and 56 percent.
Meatballs are now 5 euros, and several of the pre-made sandwiches have also considerably gone up in price. The ham, tuna, and chicken sandwiches used to cost 3.75; their price has increased by a euro.
‘Pretty drastic’
‘Yeah, the price increase is pretty drastic’, Beijk director Fokko van der Velde admits. But he says it’s necessary. According to him, the catering company is losing money at the UG. ‘Several hundred thousand a year.’
The purchasing prices have risen exponentially, Van der Velde explains. ‘The prices in the supermarket are frightful, as well.’ Since there are fewer people in the university buildings since the pandemic, there are also fewer customers.
Lease
The lease also plays a role, the director says. Beijk pays the UG 365,000 euros a year to be its catering company. ‘That was a reasonable amount back then’, says Van der Velde.
The lease was then lowered to 250,000 euros in exchange for a 700,000 euro investment Beijk made in the Foodcourt at Zernike, which opened its door in 2019. After that, the lease was raised again to the original 365,000.
It’s not unusual that Beijk is losing money on catering activities like these, says Van der Velde. ‘Contract catering has very small profit margins. Ideally, you’d make a 3 or 4 percent profit per year, but large losses also happen all the time.’
Expeditious
‘The price increase will make up for some of the losses’, says Van der Velde, ‘although we may have been a little expeditious.’ Some of the price increases may have been a bit too drastic, he admits. ‘We’ll lower the price of the meatball down to 4,25.’
The product range hasn’t been adjusted yet, either. But Van der Velde says that’s still coming. ‘For example, we currently sell mineral water by Chaudfontaine, but we’re going to start selling generic mineral water, too. That’s a lot cheaper. The same goes for energy drinks. We could start selling Bullit, that’s a lot cheaper than Red Bull.’
Beijk also wants to start selling a cheaper assortment of sandwiches in addition to the more expensive ones. They’ll also analyse which products are best-sellers and which don’t sell much at all. ‘We purchased entirely new register software to keep track of that. We’ll be able to see in detail which products sell and which don’t.’
Contract
In spite of the losses, Beijk isn’t looking to get out of its contract with the UG. ‘We have an agreement, and we’re sticking to it’, says Van der Velde. Besides, serving an important client like the UG gives Beijk a lot of negotiating power, Van der Velde said in an earlier interview with UKrant.
However, they won’t be able to keep this up forever, he admits. The company has been negotiating with the UG about the lease for a few months now. ‘The university is sorry that we’re losing money, but they say that’s the risk of doing business’, says Van der Velde.
The UG itself won’t say much about the issue. In a response, the uni says it talked to Beijk before the summer about a new price agreement. ‘Beijk and the university signed a new contract. Together.’